UNDER-PRESSURE local councils have been handed extra funding and will be given flexibility over their finances to help authorities “respond effectively to the Covid-19 pandemic”.

Councils across Scotland have faced large funding gaps as costs have increased and revenue streams have been reduced amid the coronavirus crisis.

The Scottish Government has stumped up around £90 million directly to local authorities, while council trusts, some of which provide leisure and cultural services and have faced severe revenue losses, will be able to receive a share of £49 million of extra funding that was made available by the UK Government last month.

Along with new financial flexibilities, the Scottish Government inisit the support package could be worth up to £750 million.

It is believed that if all councils use the new flexibilities to the maximum, it could be worth up to £600 million - but there are concerns the new powers could just simply delay costs until future years.

READ MORE: Scottish Councils issue funding warning over Covid, Brexit and climate

Councils will be able to use receipts from selling assets such as buildings to fund one-off revenue funding pressures including the extra costs brought on by the pandemic. Authorities will also be able to extend a debt repayment period over the life of an asset, rather than the contact period.

The Scottish Government will also allow councils to take a repayment holiday in either this or the next financial year in order to defer loan fund repayments.

The Scottish Government has already committed £382 million to help councils survive the pandemic and officials claim the latest support package and flexibilities will take the total support up to £1 billion.

Finance Secretary Kate Forbes said: “I have been clear that the Scottish Government needs appropriate fiscal levers in order to respond effectively to the Covid-19 pandemic. That is equally true for local government, which is why I am very pleased that we have been able to deliver a package of support for local services worth up to £750 million.

“Working in partnership with Cosla, the Scottish Government has delivered on our commitment to support councils across Scotland with a game changing package of financial flexibilities, giving them the powers they need to make informed decisions about spending at a local level.”

She added: “In addition, we are close to finalising the details of additional financial support through a lost income scheme, worth an estimated £90 million subject to confirmation of the funding from the UK Government. For trusts delivering services on behalf of councils this can also be topped up with £49 million of additional funding already confirmed.

“This support will help councils and their trusts manage the loss of income they are facing from local services due to Covid-19.”

READ MORE: Coronavirus Scotland: Kate Forbes wants 'more flexibility and funding'

Cosla’s resources spokesperson Cllr Gail Macgregor said: “We welcome this substantial package of measures from which councils can choose, depending on local circumstance.

“Responding to Covid-19 whilst continuing to deliver essential, everyday services has put extreme pressure on Local Government finances this year. “The pandemic has also meant substantial losses of income across a range of council services including leisure, sport, culture, and planning.

"Balancing budgets will be a real challenge and this has been fully recognised by Scottish Government who we have worked with constructively and positively.”